The director of a prominent Lakewood school for children with special needs, charged in a May indictment with stealing more than $630,000 in public money, will appear before a judge next week.
Rabbi Osher Eisemann will be arraigned at 9 a.m. Monday in Courtroom 307 at the Middlesex County Courthouse, according to his attorney, Lee Vartan. Eisemann is expected to plead not guilty to a host of theft and other charges, Vartan said.
Eisemann, 60, of Lakewood, is the founder and director of the School for Children with Hidden Intelligence, better known as SCHI (pronounced “shy”). He was indicted by a state grand jury on charges of theft by unlawful taking, misapplication of government property, misconduct by a corporate official and money laundering — all second-degree offenses that carry up to 10 years in prison and a fine of up to $150,000.
The school’s fundraising foundation, the nonprofit Services for Hidden Intelligence LLC, was also named in the indictment with the same charges. The school itself was not charged.
State Attorney General Christopher Porrino said the school provided money to the fundraising foundation, instead of the other way around, and that Eisemann allegedly used the foundation’s bank accounts to fund ventures that had no connection to the school.
SCHI receives around $1.8 million each month from the Lakewood School District and surrounding public school districts that send students to SCHI, Porrino said.
The school provides educational services for the “medically fragile, and socially emotionally challenged children,” according to its website.
Although the tuition money for SCHI is expected to “be used strictly for operating expenses of school,” Porrino said Eisemann allegedly used the fundraising foundation to take out around $430,000 to invest in a business associate’s now-defunct clothing line, called TAZ Apparel LLC, which was based in Highland Park. No one associated with TAZ could be reached for comment.
Neither the school nor the fundraising foundation had any interest in TAZ Apparel, Porrino said, and Eisemann allegedly invested in the clothing line as a “personal investment.” Authorities from the Division of Criminal Justice reportedly found contracts between Eisemann and the owner of TAZ Apparel, in which Eisemann agreed to finance a maximum of $550,000 in the business while the owner — who Porrino did not name — would manage the day-to-day operations. The grand jury said the payments were made between 2011 and 2015.
Eisemann is charged with transferring money from the school’s operating account into the accounts of the fundraising foundation, then sending around $277,000 to TAZ using checks and wire transfers, Porrino said. Eisemann also is accused of paying TAZ Apparel’s credit card bills — $153,000 in American Express fees, according to the charges.
Eisemann allegedly funneled an additional $200,000 from the school operating’s account through the fundraising accounts, which Porrino said was illegally laundered to make it look as if Eisemann was repaying debts to the school using his own money.
The $200,000 allegedly traveled through the school, then was transferred between “several unrelated entities,” individual people — including TAZ Apparel — and back into Eisemann’s personal bank account. Porrino said the alleged money-laundering was carried out over six days in March 2015.
Jeff Ifrah, the school’s lawyer, said that Eisemann is “not denying a loan was made.” He said that Eisemann, though, used his own money for the loans. “His full intent was that the loan would be repaid.”
Eisemann, through his attorney, has denied all wrongdoing.